Japanese Oil Candles Patterns Explained

Oil Trading with Candlestick

Brief History

Candlestick were developed in the 18th century by the legendary rice trader known as Homma Munehisa to give an overview of opening, high, low & closing market oil price over a given period of time.

They were used by the legendary rice trader to predict future market oil prices. After dominating trading the rice market, Munehisa then eventually moved to the Tokyo exchanges where he then gained a huge fortune using this trading analysis. It is said that He made over a hundred consecutive winning trades.

Types of Oil Trading charts

There are 3 types of charts used in Oil Trading: Line, bar & candles.

Line - plots a continuous line connecting closing oil prices of oil.

Bars- displayed as sequence of OHCL bars. OHCL represents OPEN HIGH LOW and CLOSE. The Opening crude oil price is displayed as a horizontal dash on left and closing crude oil price as a horizontal dash on the right.

The main disadvantage of a bars is that it isn't visually appealing, therefore most traders don't use them.

Candlesticks Patterns - Japanese Candlestick Oil Trading Charting Techniques - these use the same crude oil price data as bar oil charts (open, high, low, and close). However, they in a much more visually identifiable way which resembles a candle stick with wicks on both ends.

How to Analyze Japanese Candlestick Oil Trading Charting Techniques

The rectangle part is called the body.

The high and low are described as shadows & drawn as poking lines.

The color is either blue or red

• (Blue or Green Color) - Oil Trading Prices moved up
• (Red Color) - Oil Trading Prices moved down

Most oil trading platforms like the MT4, use colors to mark the direction. Colors used are blue or green: when crude oil price moves up, red: when crude oil price moves down.

Candles Vs. Bar Oil Trading Chart

When candlesticks are used it is very easy to see if the crude oil price moved up or down as opposed to when a bars are used.

The Japanese Candlestick Oil Trading Charting Techniques also have very many formations that are used to trade the Oil Trading market. Japanese Candlestick Oil Trading Charting Techniques - candlesticks patterns have different technical analysis explanation and the most common Japanese Candlestick Oil Trading Charting Techniques are:

The above Japanese Candlestick Oil Trading Charting Techniques and Patterns is what makes the Japanese candlesticks popular among crude oil trading technical traders & it is why this type of analysis are the most widely used when it comes to analyzing the crude oil market. The analysis for these Japanese candlesticks pattern formations in oil trading is the same as that one used in stocks trading - Japanese Candlestick Oil Trading Charting Techniques.

Drawing japanese Candles Oil Charts on MetaTrader 4 Platform

To draw these on the MT4, select the MetaTrader 4 oil charts drawing tools within the "MT4 Toolbar" - shown below.

To view this tool-bar on MetaTrader 4 navigate to 'View' Next to file at the top left corner of the MT4 Platform, Click 'View', Then Click 'Tool bars', Then check the 'Charts' Button. The above toolbar will appear.

Once the above toolbar, appears you can then choose the type you want to convert to, If you want to view using the bar format, click the bar tool button key as displayed above, for line format click the line tool button key, for Japanese candles format click "candlesticks tool button key".

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